How could reference price and loyalty influence brand choice?
by Begona Alvarez Alvarez, Rodolfo Vazquez Casielles
International Journal of Entrepreneurship and Small Business (IJESB), Vol. 3, No. 3/4, 2006

Abstract: This study discusses the process of brand choice and the variables taking part in it. Segmentation is carried out according to the customers' loyalty. A panel consisting of 4000 households nationwide is used. The first part of the study explains how the reference prices are built. Then, it shows the effect that the comparison between prices and reference prices (losses or gains) has on brand choice. Finally, it analyses how the response before the previous variables varies based on the loyalty of the households. The issues covered in this paper are meaningful and important because the results can help with the formulation of strategies.

Online publication date: Wed, 15-Mar-2006

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